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Overlooked E-Book Chapter: DRM Makes Monopolies (2012 CEA repost)

(Since a site redesign at the Consumer Electronics Association resulted in the posts I wrote for CEA’s Digital Dialogue blog vanishing, along with everything there older than last November, I’m reposting a few that I think still hold up. This one ran on April 17, 2012; since then, sci-fi publisher Tor Books–a subsidiary of the Macmillan publishing conglomerate–has gone DRM-free, but most of the industry has yet to take that step.)

Even if you’ve been following the e-books story for the past five years, it can be hard to define the heroes and villains of that plot.

First Amazon was the innovator, liberating us from paper with its Kindle. Then Apple was going to upend things with the iPad’s iBooks app and store. Now the Department of Justice says that the real problem is an unholy union of the publishers and Apple.

In an antitrust lawsuit announced last Wednesday, the DoJ charged Hachette Book Group, HarperCollins Publishers, Simon & Schuster, Macmillan, Penguin Group and Apple with conspiring to fix prices, to the disadvantage of consumers and Amazon.

The first three publishers have already agreed to a settlement that will block “most-favored nation” clauses that prevent e-book stores from discounting titles while allowing them to place other limits on the sale of their work. Meanwhile, Macmillan, Penguin and Apple continue to fight the suit.

It’s an immensely complicated issue, colored to a large degree by who you think is more evil. Is the problem the big publishers targeted by the DoJ’s suit, who allegedly colluded over dinners in expensive Manhattan restaurants? Or is it the gigantic Seattle retailer, which both controls a huge share of e-book sales and has been getting into the publishing business itself?

(A CEA press release posits a third foe, quoting association president Gary Shapiro calling the lawsuit “another sad milestone in our government’s war on American companies.”)

But the basic issue at stake here is not complex: ensuring vigorous competition in e-books that eliminates the need for court battles and consent decrees. And in that context, you can’t ignore how publishers have not just given Amazon a tool to build a monopoly but required its use.

This is the “digital rights management” restrictions required by publishers on e-book titles sold through all of the major online outlets–not just Amazon’s Kindle Store but also Barnes & Noble’s Nook store and Apple’s iBookstore.

DRM is supposed to stop unauthorized copying and sharing by making a copyrighted work playable, readable or visible only on authorized products. It’s not always a huge annoyance: DVDs and Blu-ray discs employ standardized–if easily circumvented–DRM that doesn’t limit you to player hardware or software specifically approved by a movie studio.

But in the world of digital downloads, DRM usually locks the “buyer” of a DRMed item into using only one vendor’s hardware or software.

So long as DRM stays part of the plot, every Kindle reader sold, every Kindle app installed and every Kindle title purchased will strengthen Amazon’s hand.

DRM can’t solve this problem, any more than any form of DRM tolerable to home users can abolish copyright infringement. But ditching it would erase the equation. If you could buy an e-book in a standard format that, like an MP3 music file, would be playable on current and imaginable future hardware, it wouldn’t matter which store sold it. There would be no lock-in; each sale would would not weigh so heavily on the next.

(As I wrote last spring, not having to worry about DRM-induced obsolescence would also vastly increase the odds of me buying e-books at all.)

But in much traditional-media coverage of digital content, DRM remains the lock that dare not speak its name. You can read a thousand-word piece about the slow market for movie downloads that notes a “lack of interoperability” without ever explaining why–or even using that three-letter abbreviation. Many of last week’s stories about Amazon, Apple and book publishers miss this point just as badly. And if we can’t properly identify this issue, we certainly can’t fix it.